iPad RSS app Reeder is lush, but Blogshelf has a nicer shopfront, I think. It basically pilfers the look and feel of the iBooks app, so the blogs you subscribe to are presented like books on shelves, minus the dust.
They cost the same amount of dosh ($5, which is really too much if you ask me), but in his review Kyle certainly seemed enamored by Reeder.
If there's one downfall with Blogshelf, it's that it only lets you subscribe to 90 blogs. That's definitely not enough for a pro-blogger, but might be enough for the casual browser who just wants to stay up to date on their favorite design sites, or sports sites or something. When the app is first downloaded, you can choose from hundreds of sites to add to the reader, to get you started.
Offline reading is supported just like Reeder's, which caches all the blog posts you missed so you can catch up with them on the train, for example.
Really, you're going to be downloading this app for the look and feel of it, more than the features. However, it's entirely reasonable to expect that Apple might add RSS feed options to the iBooks app, now that it supports PDFs. Let's play the waiting game. [iTunes via Recombu]